Simple Assessment that's completely wrong

GDB2222

My wife has received a simple assessment that is completely up the creek. It includes two bank accounts that she doesn't have, and another bank account that she holds as a bare trustee (and which is included on the beneficiaries' tax returns).

On the other hand she gets income from a trust fund, which is mostly taxed at source, and that has been omitted.

The amount of tax being demanded may be a bit high. However, I'm concerned that if she writes to HMRC to correct the simple assessment they'll want her to complete a full self assessment, instead. That's well beyond her ability, so she'd need to pay an agent to complete that, and the agent's cost will be far more than the tax demanded. Plus, there's a fair amount of admin needed to supply him with the figures.

I am inclined to be lazy, and simply pay the tax, but I suspect that may be storing up future problems?

eskbanker

What makes you think that correcting errors would lead to a self-assessment request?

There's a lot of fear and uncertainty about that process, which really isn't particularly tricky, especially when weighed against using a third party if the bulk of the effort is in locating preparatory documentation, and ultimately the taxpayer is responsible for paying the right amount of tax, albeit definitely overpaying wouldn't be a problem…

GDB2222

"What makes you think that correcting errors would lead to a self-assessment request?"

Possibly the trust income makes this case complex?

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/82173698#Comment_82173698

How much is the the trust income? When did she notify HMRC of the trust income for 2025/26?

Have you checked HMRC's Self Assessment criteria tool?

https://www.gov.uk/check-if-you-need-tax-return

poseidon1

Receipt of any taxed trust income triggers a requirement to self assess via SA100 and suplementary form SA107.

I assume she receives an annual tax deduction certificate form R185 from the trustees? You should be aware HMRC have no reason to know about it, hence the need to self declare .

If this is beyond her capabilities any reason you can't take this on rather than paying an accountant to handle the matter?

As regards funds held on bare trust, is it crystal clear from the account designation that it is a bare trust? Furthermore can I assume the trust is for someone other than your own minor children (assuming the beneficiary is indeed a minor ).

GDB2222

https://forums.moneysavingexpert.com/discussion/comment/82173822#Comment_82173822

Thanks. I guess we should bite the bullet and do a SA return. I’ll ask the accountant to do it.

I assumed that the R185 is sent to HMRC. It has one of their references on it.

GrubbyGirl_2

Before you rush in and complete a self assessment why not just call them? She can certainly correct the incorrect bank accounts on the phone then you can discuss with them whether a SA is needed. They are very helpful on the phone

MattMattMattUK

I don't see the fear of a self assessment, it is pretty easy and as long as she already has her figures together it is unlikely to take more than half an hour.

Shylock_249

Is HMRC now listing interest from named banks on their correspondence to you? Previously they just provided one figure lumped together representing all interest (rightly or wrongly) earned.

Me and the wife had to move over to SA, I found it a bit daunting, simply because I had NOT done enough home-work, especially by NOT understanding Payments on Account.

I sought advice on this forum and (really) helpful posters such as eskbanker helped me through the process. I'd be loath to employ a 3rd party to complete SA for me simply because I'd have to provide the guy with all the details anyway and as eskbanker has written above, it's ultimately our responsibility to pay the correct tax.

Good Luck

DRS1

Am I wrong to think that having trust income means you can't use the online SA return at Gov.uk and you would have to use some outside software to do the return?

LITRG

Hi GDB2222, you may find our following news article helpful as it explains what to do if you believe your simple assessment is incorrect:

Check the savings interest figure included in your tax calculation – it’s not always correct. | Low Incomes Tax Reform Group

as well as our general guidance on simple assessments:

Simple assessment | Low Incomes Tax Reform Group

You may also find our guidance on how income received from certain trusts are taxed helpful:

Paying tax on trust and estate income | Low Incomes Tax Reform Group

as well as our general guidance on self assessment:

Self assessment and tax returns | Low Incomes Tax Reform Group